Growth is the perennial buzzword of the World Economic Forum – and this year is no exception. Delegates keep assuring us that their own profitability is vital for safeguarding humanity, while we ordinary people go about our day-to-day lives: we happily drive our cars, book flights to our next holiday destination and raise our children as we’ve always done.

It seems that we are in collective denial about the threatening implications of reality. We still trust in the old narratives that growth and competition are good, that technology and experts will fix it and that capitalism is history’s ultimate victor.

Not only ecological limits and growing social inequality, but also the increasing violence of fundamentalists of all sorts indicates that it is high time for a new economic and social narrative. An economy that is essentially based on competition will always perpetuate violence and hatred.

Wanted: new economic narratives

Before a new narrative – degrowth, for example – can gain ground, we have to accept that there are only radical options left. We have to choose between our economy and our future.

In circles closer to the mainstream, I have personally observed that criticizing the dependence on economic growth and calling for a social-ecological transformation of the economy is welcomed by many.

Doubts and reluctance stem from the widespread perception that transforming the system is unrealistic, given the powerful interests of the elites.

Ordinary people feel subject to, rather than masters of, their circumstances.

In order for the vision of a degrowth society to become broadly accepted as a realistic option, we need to agree on the following points:

Degrowth is not against innovative technologies, but requires them to be administered democratically and “convivially” based on the precautionary principle

It is high time to shape a broad social movement

Despite what corporate interest groups say, we can all understand that a good life does not require ever more traffic, bigger houses, and greater quantities of waste. We cannot square the benefits of “more stuff” when it threatens our ecosystem and coincides with extreme poverty in some parts of the planet.

A good life requires long-term security in meeting everyone’s basic needs: food, shelter, affection, leisure, protection, understanding, health, participation, creation and freedom. All of these requirements are dependent on a healthy planet.

If we take our oft-cited Western values seriously, there is no doubt that we have to change our ways and ensure that our values come before any corporate or private profit.

It is high time to shape a broad social movement that pressures governments and businesses to help adjust consumption and production habits to allow the good life for everyone. We want cooperation instead of competition, common instead of corporate interest, solidarity instead of greed, strong social relationships instead of meaningless consumption, mindful resource stewardship instead of extractivism and compassion instead of indifference. We demand less traffic, fewer mega-projects and more community-based policy.

It is high time to take our future in our own hands and to realize that our current economy is part of the problem and cannot be part of the solution.

After debating with Dave Kimble for several months over the issue of whether we are at a tipping point, it appears he may have been right all along: there’s no way we are even going to reach +2ºC above 1990 temperatures. Looks like McPherson’s forecasts of Near Term Human Extinction was highly overcooked…… Why do I say this? Read on…….

Dave Kimble

The IPCC detailed report is out and, as Dave predicted, the temperature response for RCP2.6 is +1.5°C, range 1.1 – 1.8 by 2045. Thereafter they show the temperature remaining constant or microscopically getting slightly lower – in the modelling I’ve seen, it was measurably getting lower by 2100.

So no “tipping point” according to IPCC, not even for the highest scenario, RCP8.5.

The likely effect of oil limits–one way or the other–is to bring down the economy, and because of this bring an end to pretty much all carbon emissions (not just oil) very quickly. There are several ways this could happen:

High oil prices – we saw what these could do in 2008. They nearly sank the financial system. If they return, central banks have already done most of what they can to “fix” the situation. They are likely to be short of ammunition the next time around.

Low oil prices – this is the current problem. Oil companies are cutting back on new expenditures because they cannot make money on a cash flow basis on shale plays and on other new oil drilling. Oil companies can’t just keep adding debt, so they are doing less investment. I talked about this in Beginning of the End? Oil Companies Cut Back on Spending. Less oil means either a rebound in prices or not enough oil produced to go around. Either way, we are likely to see massive recession and falling world GDP.

Huge credit problems, such as happened in 2008, only worse. Oil drilling would stop within a few years, because oil prices would drop too low, and stay too low, without lots of credit to prop up prices of commodities of all types.

Rapidly rising interest rates, as QE reaches its limits. (QE for the United States was put in place at the time of the 2008 crisis, and has been continued since then.) Rising interest rates lead to higher needed tax rates and high monthly payments for homes and cars. The current QE-induced bubble in stock, land, and home prices is also likely to break, sending prices down again.

End of globalization, as countries form new alliances, such as Russia-China-Iran. The US is making false claims that we can get along without some parts of the world, because we have so much natural gas and oil. This is nonsense. Once groups of countries start pulling in opposite directions, the countries that have been using a disproportionate share of oil (particularly Europe, the United States, and Japan) will find themselves in deep trouble.

Electric grid failures, because subsidies for renewables leave companies that sell fossil-fuel powered electricity with too little profit. The current payment system for renewables needs to be fixed to be fair to companies that generate electricity using fossil fuels. We cannot operate our economy on renewables alone, in part, because the quantity is far too small. Creation of new renewables and maintenance of such renewables is also fossil fuel dependent.

Given the choice between economic collapse and runaway climate change, collapse is the pick. Collapse, however, brings surprising results according to Gail. Have a look at this chart of hers showing Peak ALL energy happening next year:

See that pale blue strip at the top? It’s energy produced by renewables. By 2035, it is half the height of what it is today. And the purple nuclear strip is maybe no more than a quarter of today’s……. ALL high tech ‘solutions’ require complex systems driven by cheap and abundant fossil fuels. And the demise of cheap and abundant fossil fuels is exactly what will bring all this complexity to its knees….. If you want energy security for yourself using renewables, I urge you to waste no time, do it now… Gail further states:

The IPCC’s Message Isn’t Really Right

We are bumping up against limits in many ways not modelled in the IPCC report. The RCP2.6 Scenario comes closest of the scenarios shown in providing an indication of our future situation. Clearly the climate is changing and will continue to change in ways that our planners never considered when they built cities and took out long-term loans. This is a problem not easily solved.

One of the big issues is that energy supplies seem to be leaving us, indirectly through economic changes that we have little control over. The IPCC report is written from the opposite viewpoint: we humans are in charge and need to decide to leave energy supplies. The view is that the economy, despite our energy problems, will return to robust growth. With this robust growth, our big problem will be climate change because of the huge amount of carbon emissions coming from fossil fuel burning.

Unfortunately, the real situation is that the laws of physics, rather than humans, are in charge. Basically, as economies grow, it takes increasing complexity to fix problems, as Joseph Tainter explained in his book, The Collapse of Complex Societies. Dissipative structures provide this ever-increasing complexity through higher “energy rate density” (explained in the Chaisson article linked above –).

We need to understand what are really up against, if we are to think rationally about the future. It would be helpful if more people tried to understand the physics of the situation, even if it is a difficult subject. While we can’t really expect to “fix” the situation, we can perhaps better understand what “solutions” are likely to make the situation worse. Such knowledge will also provide a better context for understanding how climate change fits in with other limits we are reaching. Climate change is certainly not the whole problem, but it may still play a significant role.

For the whole picture, I can’t recommend reading the original enough…… it may well be the most important article Gail has ever written….

I first came across James Howard Kunstler in that classic old Peak Oil movie, The End of Suburbia….. I liked his style immediately, dry humour, classic one liners, you know what I’m talking about if you’ve ever read any of his work…

Normally known as an Uber Doomer, it is rather unusual for Kunstler to write something like this…… it’s about solutions, even hopium; of sorts.

I’m too busy painting stuff around the house to write anything at the moment…. so enjoy this piece.

The best way to feel hopeful for the future is to prepare for it.

The best way to feel hopeful about our looming energy crisis is to get active now and prepare for living arrangements in a post-oil society.

Out in the public arena, people frequently twang on me for being “Mister Gloom’n’doom,” or for “not offering any solutions” to our looming energy crisis. So, for those of you who are tired of wringing your hands, who would like to do something useful, or focus your attention in a purposeful way, here are my suggestions:

1. Expand your view beyond the question of how we will run all the cars by means other than gasoline.

This obsession with keeping the cars running at all costs could really prove fatal. It is especially unhelpful that so many self-proclaimed “greens” and political “progressives” are hung up on this monomaniacal theme. Get this: the cars are not part of the solution (whether they run on fossil fuels, vodka, used frymax™ oil, or cow shit). They are at the heart of the problem. And trying to salvage the entire Happy Motoring system by shifting it from gasoline to other fuels will only make things much worse. The bottom line of this is: start thinking beyond the car. We have to make other arrangements for virtually all the common activities of daily life.

2. We have to produce food differently.

The Monsanto/Cargill model of industrial agribusiness is heading toward its Waterloo. As oil and gas deplete, we will be left with sterile soils and farming organized at an unworkable scale. Many lives will depend on our ability to fix this. Farming will soon return much closer to the center of American economic life. It will necessarily have to be done more locally, at a smaller-and-finer scale, and will require more human labor. The value-added activities associated with farming — e.g. making products like cheese, wine, oils — will also have to be done much more locally. This situation presents excellent business and vocational opportunities for America’s young people (if they can unplug their iPods long enough to pay attention.) It also presents huge problems in land-use reform. Not to mention the fact that the knowledge and skill for doing these things has to be painstakingly retrieved from the dumpster of history. Get busy.

3. We have to inhabit the terrain differently.

Virtually every place in our nation organized for car dependency is going to fail to some degree. Quite a few places (Phoenix, Las Vegas, Miami …) will support only a fraction of their current populations. We’ll have to return to traditional human ecologies at a smaller scale: villages, towns, and cities (along with a productive rural landscape). Our small towns are waiting to be reinhabited. Our cities will have to contract. The cities that are composed proportionately more of suburban fabric (e.g. Atlanta, Houston) will pose especially tough problems. Most of that stuff will not be fixed. The loss of monetary value in suburban property will have far-reaching ramifications. The stuff we build in the decades ahead will have to be made of regional materials found in nature — as opposed to modular, snap-together, manufactured components — at a more modest scale. This whole process will entail enormous demographic shifts and is liable to be turbulent. Like farming, it will require the retrieval of skill-sets and methodologies that have been forsaken. The graduate schools of architecture are still tragically preoccupied with teaching Narcissism. The faculties will have to be overthrown. Our attitudes about land-use will have to change dramatically. The building codes and zoning laws will eventually be abandoned and will have to be replaced with vernacular wisdom. Get busy.

4. We have to move things and people differently.

This is the sunset of Happy Motoring (including the entire US trucking system). Get used to it. Don’t waste your society’s remaining resources trying to prop up car-and-truck dependency. Moving things and people by water and rail is vastly more energy-efficient. Need something to do? Get involved in restoring public transit. Let’s start with railroads, and let’s make sure we electrify them so they will run on things other than fossil fuel or, if we have to run them partly on coal-fired power plants, at least scrub the emissions and sequester the CO2 at as few source-points as possible. We also have to prepare our society for moving people and things much more by water. This implies the rebuilding of infrastructure for our harbors, and also for our inland river and canal systems — including the towns associated with them. The great harbor towns, like Baltimore, Boston, and New York, can no longer devote their waterfronts to condo sites and bikeways. We actually have to put the piers and warehouses back in place (not to mention the sleazy accommodations for sailors). Right now, programs are underway to restore maritime shipping based on wind — yes, sailing ships. It’s for real. Lots to do here. Put down your iPod and get busy.

5. We have to transform retail trade.

The national chains that have used the high tide of fossil fuels to contrive predatory economies-of-scale (and kill local economies) — they are going down. WalMart and the other outfits will not survive the coming era of expensive, scarcer oil. They will not be able to run the “warehouses-on-wheels” of 18-wheel tractor-trailers incessantly circulating along the interstate highways. Their 12,000-mile supply lines to the Asian slave-factories are also endangered as the US and China contest for Middle East and African oil. The local networks of commercial interdependency which these chain stores systematically destroyed (with the public’s acquiescence) will have to be rebuilt brick-by-brick and inventory-by-inventory. This will require rich, fine-grained, multi-layered networks of people who make, distribute, and sell stuff (including the much-maligned “middlemen”). Don’t be fooled into thinking that the Internet will replace local retail economies. Internet shopping is totally dependent now on cheap delivery, and delivery will no longer be cheap. It also is predicated on electric power systems that are completely reliable. That is something we are unlikely to enjoy in the years ahead. Do you have a penchant for retail trade and don’t want to work for a big predatory corporation? There’s lots to do here in the realm of small, local business. Quit carping and get busy.

6. We will have to make things again in America.

However, we are going to make less stuff. We will have fewer things to buy, fewer choices of things. The curtain is coming down on the endless blue-light-special shopping frenzy that has occupied the forefront of daily life in America for decades. But we will still need household goods and things to wear. As a practical matter, we are not going to re-live the 20th century. The factories from America’s heyday of manufacturing (1900 – 1970) were all designed for massive inputs of fossil fuel, and many of them have already been demolished. We’re going to have to make things on a smaller scale by other means. Perhaps we will have to use more water power. The truth is, we don’t know yet how we’re going to make anything. This is something that the younger generations can put their minds and muscles into.

7. The age of canned entertainment is coming to and end.

It was fun for a while. We liked “Citizen Kane” and the Beatles. But we’re going to have to make our own music and our own drama down the road. We’re going to need playhouses and live performance halls. We’re going to need violin and banjo players and playwrights and scenery-makers, and singers. We’ll need theater managers and stage-hands. The Internet is not going to save canned entertainment. The Internet will not work so well if the electricity is on the fritz half the time (or more).

8. We’ll have to reorganize the education system.

The centralized secondary school systems based on the yellow school bus fleets will not survive the coming decades. The huge investments we have made in these facilities will impede the transition out of them, but they will fail anyway. Since we will be a less-affluent society, we probably won’t be able to replace these centralized facilities with smaller and more equitably distributed schools, at least not right away. Personally, I believe that the next incarnation of education will grow out of the home schooling movement, as home schooling efforts aggregate locally into units of more than one family. God knows what happens beyond secondary ed. The big universities, both public and private, may not be salvageable. And the activity of higher ed itself may engender huge resentment by those foreclosed from it. But anyone who learns to do long division and write a coherent paragraph will be at a great advantage — and, in any case, will probably out-perform today’s average college graduate. One thing for sure: teaching children is not liable to become an obsolete line-of-work, as compared to public relations and sports marketing. Lots to do here, and lots to think about. Get busy, future teachers of America.

9. We have to reorganize the medical system.

The current skein of intertwined rackets based on endless Ponzi buck passing scams will not survive the discontinuities to come. We will probably have to return to a model of service much closer to what used to be called “doctoring.” Medical training may also have to change as the big universities run into trouble functioning. Doctors of the 21st century will certainly drive fewer German cars, and there will be fewer opportunities in the cosmetic surgery field. Let’s hope that we don’t slide so far back that we forget the germ theory of disease, or the need to wash our hands, or the fundamentals of pharmaceutical science. Lots to do here for the unsqueamish.

10. Life in the USA will have to become much more local, and virtually all the activities of everyday life will have to be re-scaled.

You can state categorically that any enterprise now supersized is likely to fail — everything from the federal government to big corporations to huge institutions. If you can find a way to do something practical and useful on a smaller scale than it is currently being done, you are likely to have food in your cupboard and people who esteem you. An entire social infrastructure of voluntary associations, co-opted by the narcotic of television, needs to be reconstructed. Local institutions for care of the helpless will have to be organized. Local politics will be much more meaningful as state governments and federal agencies slide into complete impotence. Lots of jobs here for local heroes.

So, that’s the task list for now. Forgive me if I left things out. Quit wishing and start doing. The best way to feel hopeful about the future is to get off your ass and demonstrate to yourself that you are a capable, competent individual resolutely able to face new circumstances.

~~~~~

James Howard Kunstler is a leading writer on the topic of peak oil and the problems it poses for American suburbia. Deeply concerned about the future of our petroleum dependent society, Kunstler believes we must take radical steps to avoid the total meltdown of modern society in the face of looming oil and gas shortages.

ABC TV (Australia) has a program this coming Thursday 1 August on PEAK OIL (and energy in general from the shorts I have seen…) that I think we should all watch. I’ll post something about the show once it’s been aired, and I’d love to hear what you all thought of it……..

Thursday, 1 Aug 8:30pm

Dick Smith, self proclaimed single biggest individual fuel user in Australia, goes in search of the energy options that will decide Australia’s future.

Some of our most serious global worries revolve around energy – controlling it, paying for it, and the consequences of burning it. As both one of the world’s biggest per capita users and exporters of fossil fuels, Australia is sure to be deeply affected by the radical changes coming down the energy pipeline. Self-confessed fuel junkie Dick Smith explores Australia’s options as we enter the age of energy disruption.

I’ve written a fair bit about Egypt….. if you ever need proof of what happens post Peak Oil, look no

Matt Mushalik

further than Egypt. Or, ironically, several other Middle Eastern and oil producing countries! Twenty years after its oil peak, Egypt is now embroiled in a serious energy crunch. Crude oil production will decline between 3 and 4 % pa while population may grow (though I personally doubt it…) from 80 million to 100 million by 2030. It is in the Matrix’s interest to make sure that Egypt does not descend into chaos which will impact not only on global oil markets but also on neighbouring countries. This will require to help Egypt with importing crude oil.

With thanks to CRUDE OIL PEAK and Matt Mushalik for the charts, here are some simple calculations of what kind of quantities would be involved:

In this graph we have plotted

3 population scenarios (LHS scale) for 3 different fertility levels from the UN Population Division

Additional import requirements of 1.7 Gb for the lowest population scenario in order to keep current consumption levels

Further additional import requirements of 0.7 Gb each for the higher population projections

We translate this into daily oil requirements:

Is it just me, or do some of those scenarios look like impossibilities………….????

In the next years increasing quantities up to 200 kb/d by 2020 are needed.

This graph shows uneven distribution of population and crude oil production in Egypt and neighbouring countries between Libya in the West and Iran in the East. Egypt with the highest population is more vulnerable than Iran. Note that the total population of this group of countries is 266 million.

Oil production per capita is an important parameter for wealth creation. The most populous countries Egypt and Iran are at the bottom of the scale. Yemen is the last in the list.

So where will the oil come from to help Egypt? This article gives us a foretaste of what is to come:

Egypt closer to sealing $1 billion Libya oil deal

27/6/2013

CAIRO — Egypt is inching closer to getting a letter of credit to back a $1-billion much-needed oil supply contract with Libya, but the deal still faces a stumbling block in Tripoli, which fears being dragged into Cairo’s economic woes, officials said.

State-owned Egyptian General Petroleum Corp. (EGPC) has asked the National Bank of Egypt for a $1 billion guarantee that will allow it to complete its side of the oil deal with Libya, a bank official said. However, the Libyan government has yet to decide that a letter of credit from that bank is strong enough to overcome the risk of any losses if EGPC is unable to pay for the oil, said a government official.

Failure to agree the deal would be a significant blow for Eqypt because it is seen as vital for easing the country’s fuel shortage. An even bigger oil supply deal with Iraq has faltered due to similar concerns over financial guarantees.

“We have asked EGPC to give us first a guarantee from the finance ministry before we study its request since its loans have exceeded 20% of our capital base, or about 22 billion Egyptian pounds ($3.13 billion),” Mahmoud Montaser, NBE’s corporate banking and syndicated loans senior group head told <em>The Wall Street Journal

“We got the guarantee from the finance ministry and hopefully the letter of credit will be issued soon,” Montaser, who is also a board member of the state bank, said.

Egypt has been facing a diesel shortage since last year, leading to rising food costs, long queues at filling stations and electricity blackouts. Egyptians have also taken to the Internet and streets to protest daily power cuts that they say are getting more frequent and lasting longer.

Neighboring Libya, an OPEC member, had agreed in March to supply Egypt with up to 1 million barrels a month of crude oil, with a generous credit term of up to a year, which would help Egypt with both its fuel shortage and its cash flow problems.

Egypt has so far been unable to provide a guarantee for the payments to Libya, which is concerned about the political and economic turmoil in the country. Even with a letter of credit from the NBE, Libya is still reluctant to give a stamp of approval.

“The National Bank of Egypt. It’s not a triple A bank,” said a Libyan official familiar with the deal. This means that going through with the deal on that basis, “will require…guarantees from the central bank of Libya,” the official said. The official said the Libyan Foreign Bank–in charge of providing a $1-billion credit line for the country’s National Oil Co.–was concerned that exposure to such large risks in the EGPC deal would impede its own financial flexibility, especially when it comes to issuing letters of credit to other commercial partners.

The Egyptian fuel crisis has compounded broader economic problems in the country, which in 2011 overthrew the government of President Hosni Mubarak in a popular uprising. Egypt’s current government, which is dominated by Islamist party the Muslim Brotherhood, is short of funds and has been negotiating a $4.8-billion loan with the IMF, which analysts and investors say is critical for the country. IMF officials left Cairo in April without agreeing on the terms of the loan.

Iraq has also offered 4 million barrels of oil a month to Egypt, with payment deferred for three months with no interest incurred. However, the country’s oil minister, Abdul Kareem Luaiby, said last month the deal will be completed only if the North Africa country provided a letter of credit “opened in internationally recognized banks prior to the supply, but Egypt has so far [been] unable to open such letter of credit.”

Egypt’s energy import needs are rising because of a drop in its own hydrocarbon production, stemming from a slowdown in exploration over several years of civil unrest. EGPC has also been paying hefty premiums to import fuel because of the weaker Egyptian pound. It is struggling to pay debts of about $5 billion to foreign energy companies, according to officials familiar with the situation.

Conclusion:

Whoever comes to power now faces the same impossible situation. If the problem of fuel shortages in Egypt cannot be resolved by oil imports, violence may impact on other countries and there is the prospect of one the world’s chokepoints in serious danger.

Matt Mushalik, who wrote this piece, seems to believe “In the end there will be no other choice than OPEC supplying as much oil as is needed to keep Egypt going, on credit or at discounted rates. That oil of course will not be available to those who thought they can always buy oil for their pleasure.”

But Matt…… Egypt is already in debt overshoot…. HOW will it repay the credit extended to it for that Lybian oil?

Anyone who thinks this will not end in tears truly has his head in the Saharan sand…